The chair of the Press Complaints Commission has defended its role as an independent watchdog and attacked so-called "super-injunctions" to keep legal action against the press secret.

In her first major speech in the job, the Conservative peer Lady Buscombe condemned the use of super-injunctions as "anathema to democracy".

The Trafigura affair – in which an oil trading firm tried unsuccessfully to prevent the Guardian from reporting a parliamentary question about its activities – demonstrated the power of social media sites such as Twitter and why statutory regulation of the press was unfeasible, she said.

"In the long term, those who want to impose legal restrictions on the media are not just on the wrong side of the argument about freedom of expression, they are also on the wrong side of history," she told newspaper editors and executives at a Society of Editors conference in Stansted, Essex.

"In a world where individuals can communicate en masse and bypass traditional media altogether, it is just no longer possible to restrict the free flow of information from the top down. The sooner that regulators, legislators and lawyers realise this the better."

She called on the government to curb the use of super-injunctions. "The idea that a judge who may be no expert in the field can dish out so-called super-injunctions – preventing us from even knowing that he or she has restrained publication – is insulting to the public and anathema to democracy," she said. "How did it ever come to this? As a parliamentarian, I do not recall ever debating this proposition, or agreeing that lawyers could scuttle off to the high court in order to keep true but embarrassing information out of the public domain. Nor do I recall it being suggested that parliament would be prevented by the law itself from scrutinising how the law was developing. This is a constitutional outrage. Now that the secret is out, the government must do something about it without delay."

Buscombe, who became PCC chairman in April, said that self-regulation worked "on the basis of good old-fashioned common sense".

Rounding on critics such as former deputy prime minister John Prescott, who has attacked "do-it-yourself regulation" of the press, she said: "The press do not regulate themselves. The PCC is funded by the newspaper and magazine industry but operates independently of it. Its independence is guaranteed by a majority of lay members, and staff who have no vested interest in siding with the press. Is that really so difficult a concept to grasp?

She said the watchdog could provide a conduit for anger about controversial media coverage such as an article about the death of Boyzone star Stephen Gately by the Daily Mail's Jan Moir. "To those who have recently signed a petition on the No 10 website urging the government to put the PCC on a statutory footing, I say: be careful what you wish for," she said. "When there is – in the PCC – already a channel to express dismay that a paper has overstepped the line, do people want a government body telling us what we can read and think?" She also contrasted "bloated bureaucracies" in other industries with the PCC's staff of 14 and annual budget of £1.9m.

The PCC came under fire last week from the editor of the Guardian, Alan Rusbridger, who branded its report on phone hacking at the News of the World "worse than pointless". He suggested the PCC might need to be better funded "so that it has some investigatory mechanism".

Buscombe rejected this suggestion, saying she was surprised "to hear a call from some of those who are benefiting from this historic shift [to social media, in the Trafigura case] for the PCC to be reconstituted as some sort of formal regulator with quasi-legal powers".

"In this new environment, frameworks of good practice, coupled with easy, accessible complaints mechanisms are the way to keep standards high." She said the PCC was not complacent, however, and was undergoing a review of its governance structures.